ManTech International Corporation (Nasdaq:MANT) announced today that it has signed a definitive agreement to acquire Kforce Government Solutions, Inc. (KGS), formerly a wholly-owned subsidiary of Kforce, Inc. for $115 million in cash.
Headquartered in Fairfax, VA, KGS provides technology solutions, transformation management, data management and analytics in support of federal health and defense missions. KGS has built a strong legacy of success with its customers particularly within the Department of Veterans Affairs (VA). The acquisition adds over 500 highly skilled employees to the ManTech team. In 2018, KGS generated approximately $98 million of revenue and has profitability comparable to ManTech.
The combination will substantially increase ManTech’s footprint at the VA and enable ManTech to deliver services through the VA’s Transformation Twenty-One Total Technology Next Generation (T4NG) program. The T4NG program is a 10-year indefinite delivery, indefinite quantity (IDIQ) contract awarded by the VA Technology Acquisition Center (TAC) to help the VA transform its information technology programs.
“This acquisition is consistent with ManTech’s targeted federal civilian expansion strategy. We are pleased to welcome KGS’ talented employees, differentiated capabilities and important customers,” said ManTech’s President and Chief Executive Officer, Kevin M. Phillips.
Maureen Coyle, Chief Executive Officer, KGS said, “We are thrilled to become a part of ManTech. This strategic combination will help us better meet our clients’ needs by broadening and deepening our solution offerings. Additionally, our cultures are well aligned and our employees will benefit from expanded professional development opportunities.”
ManTech will fund the acquisition from cash on hand with additional funding from its existing line of credit. ManTech expects the acquisition to be slightly accretive to earnings per share in 2019. The acquisition is subject to various closing conditions and approvals, including approval under the Hart-Scott-Rodino Act, and is expected to be completed in March 2019.